Telkom hits back at tender allegations

Telkom has hit back at a Bloomberg report which stated that Telkom awarded a R91.1 million advisory contract to Bain & Co. without following an open bidding process.

Bloomberg reported “there was no record of a published or archived competitive process that led to the selection of Bain, the Boston-based management consulting firm”.

Telkom CEO Sipho Maseko hired Bain to advise the company on its broadband and mobile strategy. The report states that Bain was picked within days of the CEO’s arrival at Telkom on 1 April 2013.

Telkom hit back, saying it believes that the Bloomberg article is erroneously based on the premise that an “open tender” process is the only procurement process available to Telkom when seeking to procure products or services.

Telkom said that due to its unique position – of being a public company listed on the JSE and being classified as a State-owned company – it has, since 2001, been granted exemption from various provisions of the PFMA and all the treasury regulations issued in terms of the PFMA.

“Telkom is comfortable that its internal governance processes and policies regarding the approval and conclusion of contracts with suppliers are robust and effective,” the company said.

“The conclusion of contracts are done in accordance with Telkom’s Delegation of Authority and Procurement Policy, including those agreements concluded by the CEO, Mr Sipho Maseko.”

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